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Income Taxes (Tables)

12 Months Ended

Dec. 31, 2024

Income Tax Disclosure [Abstract]

Income Before Income Taxes

Income before income taxes consists of the following (in thousands):

		Years Ended December 31,
		2024				2023				2022
Domestic		$	(1,775	)		$	(4,058	)		$	16,552
Foreign			4,412				10,343				14,172
Total		$	2,637			$	6,285			$	30,724

Components of Income Tax Expense

The components of the income tax expense are as follows (in thousands):

		Years Ended December 31,
		2024				2023				2022
Current:
Federal		$	2,874			$	3,867			$	9,349
State			613				1,922				3,819
Foreign			4,955				2,907				2,402
Total current			8,442				8,696				15,570
Deferred:
Federal			(636	)			(3,872	)			(5,513	)
State			763				(1,597	)			(1,788	)
Foreign			(185	)			8				649
Total deferred			(58	)			(5,461	)			(6,652	)
Income tax expense		$	8,384			$	3,235			$	8,918

Reconciliation of Federal Statutory Rate

A reconciliation of the federal statutory rate to Forrester’s effective tax rate is as follows:

		Years Ended December 31,
		2024				2023				2022
Income tax provision at federal statutory rate			21.0	%			21.0	%			21.0	%
Increase (decrease) in tax resulting from:
State tax provision, net of federal benefit			40.6				8.1				5.2
Foreign tax rate differential			37.7				2.7				(0.5	)
Stock compensation			66.6				17.5				0.9
Withholding taxes			31.7				6.2				1.7
Non-deductible expenses			23.1				8.1				1.5
Goodwill related to sale of FeedbackNow			93.9				—				—
Permanent differences			(0.1	)			(1.7	)			(0.3	)
Change in valuation allowance			0.4				0.5				1.0
Foreign subsidiary income subject to U.S. tax			(1.6	)			1.2				1.3
Foreign-derived intangible income benefit			1.1				(3.8	)			(0.7	)
Change in tax legislation			—				(8.1	)			(1.6	)
Foreign exchange gain (loss) on previously taxed earnings and profits			(0.5	)			1.6				—
Currency translation gain (loss)			3.6				0.7				(0.1	)
Other, net			0.4				(2.5	)			(0.4	)
Effective tax rate			317.9	%			51.5	%			29.0	%

Components of Deferred Income Taxes

The components of deferred income taxes are as follows (in thousands):

		As of December 31,
		2024				2023
Non-deductible reserves and accruals		$	1,776			$	3,077
Net operating loss and other carryforwards			5,525				6,262
Stock compensation			2,085				2,676
Depreciation and amortization			3,485				435
Lease liability			8,562				12,276
Gross deferred tax asset			21,433				24,726
Less - valuation allowance			(1,055	)			(1,065	)
Sub-total			20,378				23,661
Other liabilities			(2,553	)			(733	)
Goodwill and intangible assets			(13,837	)			(15,181	)
Operating lease right-of-use assets			(5,822	)			(9,163	)
Deferred commissions			(6,071	)			(6,545	)
Net deferred tax liability		$	(7,905	)		$	(7,961	)

Summary of Changes in Deferred Tax Valuation Allowance

The following table provides a summary of the changes in the deferred tax valuation allowance for the years ended December 31, 2024, 2023, and 2022 (in thousands):

		2024				2023				2022
Deferred tax valuation allowance at January 1		$	1,065			$	989			$	1,114
Additions			19				39				106
Deductions			(8	)			—				(336	)
Change in tax legislation			—				(4	)			186
Translation adjustments			(21	)			41				(81	)
Deferred tax valuation allowance at December 31		$	1,055			$	1,065			$	989

Reconciliation of Unrecognized Tax Benefits

A reconciliation of the beginning and ending amount of unrecognized tax benefits is summarized as follows for the years ended December 31, 2024, 2023, and 2022 (in thousands):

		2024				2023				2022
Unrecognized tax benefits at January 1		$	—			$	—			$	5
Reductions for tax positions of prior years			—				—				(4	)
Translation adjustments			—				—				(1	)
Unrecognized tax benefits at December 31		$	—			$	—			$	—

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